Rapid CDMO growth marks a start to Endpoints Manufacturing's first report — here's what to expect from our coverage
Welcome to the first edition of Endpoints Manufacturing.
My name’s Conner Mitchell, and I’m an associate editor for Endpoints News. I joined the team in early December to cover biopharma’s global manufacturing beat, and now we’re taking that coverage up another level.
From now on, I’ll have a new report for you each Thursday with a column detailing the highlights of the week’s manufacturing news, the top news stories in one place, and an exclusive featured special to Endpoints Manufacturing. This feature will likely take on a few different forms, depending on the week, but will be a compelling way to stay up to date on the latest in the industry, exclusive to our readers.
We intend to be the leader in covering the biopharma manufacturing industry. For starters, this means that we always want to be on top of the latest news, so if there’s something that I should be aware of — good news or bad — don’t hesitate to send those tips my way.
I’ll be keeping an eye on a few key areas this year across biotech manufacturing: the continued rollout of Covid-19 vaccines and related therapeutics, the status of the various supply chains associated with those therapies, regulatory actions, how CDMOs continue to evolve after a remarkably busy 2020, the rise of cell and gene therapies, and if or how FDA oversight changes under the new Biden administration.
Manufacturing is at the heart of what turns biotech breakthroughs into innovative products and blockbusters. Every marketed drug has to travel the difficult path from small-scale clinical trial to a commercial rollout. How do they do that? Through scalable manufacturing — whether in-house or through key partners.
Here’s how you can get in touch with me:
For more secure documents: firstname.lastname@example.org (end-to-end encrypted email) or Signal (encrypted messaging) at 316-217-3852
This industry is bustling right now and almost certainly will continue to do so for years to come. It’s an exciting time for me to jump in and be able to cover it, and I look forward to talking to many of you along the way!
Featured story: Catalent sees 26% growth in FY ’21 Q2 compared to same period in 2020
It clearly pays to be one of the biggest biotech manufacturers in the world.
Catalent, the New Jersey-based manufacturing giant, reported this week that it took in growth of 26% in the second quarter of its 2021 fiscal year compared to the same quarter a year prior.
Dollars to cents, that’s a net revenue of $910.8 million, net earnings of $88.4 million (up 94% from Q2 of FY 20), and an EBITDA earnings increase of 31% ($223.5 million in Q2 FY 21).
Here’s what led to the big quarter, from Catalent’s head man:
John Chiminski, Catalent CEO: “Our second quarter results reflect robust organic growth in our Biologics segment, and our increased guidance reflects our expectation of continued strong results for these offerings for the remainder of our fiscal year. Additional capacity in our drug product and drug substance offerings will come on line in the second half of our fiscal year to help fight the pandemic and serve other critical patient needs.”
Indeed, Catalent’s biologics focus saw massive gains on the quarter. Net biologics revenue hit $403.9 million, a 79% increase from Q2 FY 20, and accounts for 44% of the company’s total net revenue for the quarter.
The one area of Catalent’s balance sheet that saw a decrease in the quarter from the year prior came in softgel and oral technologies, which, while still accounting for $246.6 million in net revenue (27% of the company’s total for the quarter), was a decrease of 8% from Q2 FY 20.
Finally, Catalent reported a 19% increase in oral and specialty delivery revenue, raking in $169.9 million for 19% of the quarter’s total net revenue.
The positive quarter also allowed Catalent to increase its overall projections for the entire fiscal year. Now, the manufacturing giant is projecting a net revenue between $3.80 billion and $3.95 billion, compared to the previous range of $3.58 billion to $3.78 billion.
This week (and year) in manufacturing
The news this week in biopharma manufacturing was slower compared to the breakneck pace of the start of 2021 — but there are several items of note.
WuXi AppTech’s subsidiary company WuXi STA announced plans to acquire a Bristol Myers Squibb facility in Couvet, Switzerland, the company’s first footprint in the Euro CDMO marketplace. And the first half of this week saw two really interesting pieces of manufacturing news: First, Cellino Biotech, a regenerative medicine startup in the Boston-area biotech hub, unveiled a $16M seed funding haul for advancing technology it hopes will revolutionize the stem cell manufacturing industry.
CEO Nabiha Saklayen founded Cellino in 2017 while still in her mid-20s (she’s since gone on to be named to Forbes’ 30 Under 30 list and MIT Tech Review’s 35 Innovators Under 35 list), and the technology itself uses artificial intelligence and a personalized tissue and cell platform with the ultimate goal of generating autologous-induced pluripotent stem cells at scale.
Why is this potentially so important? Right now, those type of stem cells have to be removed by hand, one at a time, during the manufacturing process. Cellino could be a player to watch going forward.
The second piece of news came from the Covid-19 vaccine arena. In light of the continued worry over virus variants, GlaxoSmithKline is doubling down on its CureVac partnership in search of an mRNA vaccine of the future, my colleague Amber Tong reported Wednesday morning.
Backed by $180 million from GSK, the new co-development pact will see both companies contributing resources and expertise toward a number of new mRNA vaccine candidates — “including multi-valent and monovalent approaches.” The end goal here, in addition to manufacturing millions of doses of current Covid-19 vaccines, is for GSK to have a blockbuster vaccine of its own by 2022.
How drug companies respond to Covid-19 variants through their vaccine work will be a really important area to watch, as vaccines are still able to protect against the new variants out of the UK, South Africa and Brazil, but data from the leading mRNA developers suggests they may not be as potent as they are against the original SARS-CoV2 (though so far, they do still quite effectively protect from hospitalizations and deaths).
Since this is the first issue of Endpoints Manufacturing, I also want to take a minute to look quickly at where the biopharma manufacturing industry currently stands. January, for example, was a month filled with rapid facility expansion across the globe.
Lonza, the Swiss CDMO giant, publicly announced half a dozen facility expansions or acquisitions that will together increase the company’s manufacturing capacity by over 20% in the coming years—including its first biologics facility in China and a trio of sites in Visp, Switzerland, that for the foreseeable future will focus on API production for Moderna’s mRNA vaccine.
Those expansions came alongside new facilities at Fujifilm, Thermo Fisher, Cognate and Servier, among others, not to mention the swaths of new real estate territory in the ever-growing Boston biotech hub.
All this is to say, the theme here is that the CDMO marketplace shows no signs of slowing down. A new report this week from Research and Markets projects that by 2024, the global CDMO market will reach a value of $241.3 billion—a 9.8% compound annual growth rate over just five years.
Also of note from Catalent: On Thursday, the company announced an agreement to provide Decibel Therapeutics, a clinical stage biotech company that focuses exclusively on hearing and balance therapies, with development and manufacturing capacity for Decibel’s lead investigational gene therapy candidate DB-OTO.
DB-OTO is a dual-vector adeno-associated virus gene therapy being developed in collaboration with Regeneron Pharmaceuticals (yes, the same developer of the infamous Covid-19 cocktail given to former president Donald Trump). The molecule targets those who suffer from significant and congenital hearing loss due to mutations of the otoferlin gene.
No financial terms were disclosed Thursday, but according to the agreement, Catalent will provide material from its Maryland-based gene therapy facilities to support Decibel’s planned IND-enabling studies and a Phase I/II clinical trial of the drug.
More on the deal from Catalent’s president of cell and gene therapy, Manja Boerman:
Partnering early with innovative companies allows us to develop and optimize robust, scalable manufacturing processes and the analytical methods to assess them. Our Maryland development centers in Gaithersburg and the University of Maryland BioPark in Baltimore focus on providing process optimization services to meet our customers’ needs for early-stage clinical gene therapies.